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2:07-Cv-12036-SFC-RSW Doc # 13 Filed 07/25/07 Pg 1 of 39 Pg ID 75 2:07-cv-12036-SFC-RSW Doc # 13 Filed 07/25/07 Pg 1 of 39 Pg ID 75 UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF MICHIGAN ____________________________________ IN RE GENERAL MOTORS ONSTAR LITIGATION ____________________________________ Master File No. 2:07-CV-11830 THIS DOCUMENT RELATES TO: All Actions ______________________________________ : Consolidated Master Class Action Complaint Notice To Preserve Records And Documents You are hereby notified to preserve all records and documents in all forms and formats (digital, electronic, film, magnetic, optical, print, etc.) during the pendency of this action that are relevant or may lead to relevant information and to notify your employees, agents and contractors that they are required to take appropriate action to do so. Introduction 1. Plaintiffs bring this class action against General Motors Corporation and OnStar Corporation (“OnStar”) due to the failure of analog OnStar equipment in their vehicles and termination of OnStar service. 2. OnStar is a unique in-vehicle telecommunication safety system that provides automatic crash notification to emergency responders, stolen vehicle location, 2:07-cv-12036-SFC-RSW Doc # 13 Filed 07/25/07 Pg 2 of 39 Pg ID 76 remote door unlock and remote diagnostics in the event of problems with airbags, anti- lock brakes or other systems. According to OnStar: [OnStar provides] critical communications links among members of the public, emergency medical service providers and emergency dispatch providers; public safety, fire service and law enforcement officials, and hospital emergency and trauma care facilities. * * * The life-saving benefits of OnStar are intended not only for initial vehicle purchasers but also for subsequent owners over the life of the vehicle. 3. As a result of defendants’ actions, plaintiffs and thousands of other OnStar owners, lessees and subscribers will lose the benefits of this safety system, will be exposed to an increased risk of serious personal injury and harm, and their motor vehicles will lose substantial value. Plaintiffs seek damages and appropriate injunctive relief for themselves and all others similarly situated. The Parties Plaintiffs 4. Plaintiffs Robert G. Gordon and Sarah L. Gordon are citizens and residents of Pennsylvania. Their address is 216 Chilton Way, Fairless Hills, Bucks County, Pennsylvania. 5. Plaintiff Howard Morris is a citizen and resident of Pennsylvania. His address is 342 E. Main Street, Suite 100, Leola, PA 17540. 6. Plaintiff Jack Jacovelli is a citizen and resident of New Jersey. His address is 5 Dorado Road, Laurel Springs, NJ 08021. 2 2:07-cv-12036-SFC-RSW Doc # 13 Filed 07/25/07 Pg 3 of 39 Pg ID 77 7. Plaintiff Bruce Johnson is a citizen and resident of the State of Washington. His address is P.O. Box 670 Edmunds, Washington, 98020. 8. Plaintiff Walter Rochow is a citizen and resident of Connecticut. His address is 25 Hamden Hills Drive, Hamden, Connecticut. 9. Plaintiff Irene Nary is a citizen and resident of Ohio. Her address is 31 Periwinkle Drive, Olmsted Falls, Ohio. 10. Plaintiff Julia Maurer is a citizen and resident of Pennsylvania. Her address is 10561 Buchanan Trail West, Mercersburg, Pennsylvania. 11. Plaintiff Robert B. Weaver is a citizen and resident of Virginia. He resides in Manassas, Virginia. 12. Plaintiff Laurie Christ is a citizen and resident of New York. Her address is 6 Kenwood Drive, Massapequa, New York.. 13. Plaintiff Jonathan R. Peckat is an individual residing at 2050 Lila Street, Saint Helen, Michigan. 14. Plaintiff William Todd Berry is a citizen and resident of California. He resides in Bakersfield, California. 15. Plaintiffs Susan Nelson and Norman Nelson (“Susan and Norman Nelson”) are citizens and residents of California. Their address is 6405 Bonsall Dr., Malibu, California.. Defendants 16. Defendant GM is a Delaware corporation with its principal place of business and national headquarters located at 300 Renaissance Center, Detroit, Michigan. 3 2:07-cv-12036-SFC-RSW Doc # 13 Filed 07/25/07 Pg 4 of 39 Pg ID 78 GM designs, tests, manufactures, markets, advertises, warrants, distributes, sells or leases cars, trucks and sports utility trucks under several prominent brand names, including, but not limited to: GMC, Chevrolet, Pontiac, Oldsmobile, Buick, Cadillac, Saturn and SAAB throughout the United States. 17. Defendant OnStar is a wholly owned subsidiary of GM and was at all times expressly and impliedly controlled and directed by GM; OnStar also maintains headquarters in Detroit, Michigan. 18. At all relevant times, defendants acted by and through their agents, servants, workmen and employees who were then and there acting within the course and scope of their permission, agency, employment and authority, in furtherance of defendants’ businesses, and otherwise on behalf of defendants. 19. At all relevant times, OnStar engaged in co-ventures with GM with respect to the sale and distribution of OnStar systems and equipment. Jurisdiction and Venue 20. Plaintiffs bring this action seeking class-action status and alleging violations of the Michigan Consumer Fraud Act, breach of express and implied warranties, fraudulent omission, breach of contract and injunctive relief. This Court has jurisdiction over these claims pursuant to 28 U.S.C. 1332 (d). 21. Venue is proper in this District because defendants GM and OnStar are headquartered in this District and many of the acts and transactions giving rise to the violations of law alleged herein occurred within and emanated from defendants’ offices in this District. Specifically, the marketing and sales materials discussing OnStar, and 4 2:07-cv-12036-SFC-RSW Doc # 13 Filed 07/25/07 Pg 5 of 39 Pg ID 79 containing the material misstatements and omissions alleged herein, were designed, developed and approved by GM and OnStar personnel at facilities in this District. Background 22. In the 1990s GM and OnStar developed the OnStar telematic system. 23. OnStar is a telematic safety communications system for motor vehicles which is integrated into the vehicle. The OnStar system enables occupants of vehicles with OnStar equipment and service to receive emergency service and information anywhere in the United States and portions of Canada. OnStar describes the system on its website this way: OnStar's in-vehicle safety, security, and information services use Global Positioning System (GPS) satellite and cellular technology to link the vehicle and driver to the OnStar Center. At the OnStar Center, advisors offer real-time, personalized help 24 hours a day, 365 days a year. http://www.onstar.com/us_english/jsp/explore/onstar_basics/technology.jsp 24. GM and OnStar have developed and operated the OnStar system throughout the United States and Canada since about 1998. 25. At all relevant times, GM maintained the policy and practice of manufacturing and selling OnStar equipped vehicles and providing service and parts for safety components through a network of authorized dealers. 26. OnStar equipment and service for GM vehicles is unique and is not available from sources other than defendant GM. 27. By December 2006 there were approximately 4.5 million OnStar subscribers who owned or leased GM manufactured vehicles. There were also many 5 2:07-cv-12036-SFC-RSW Doc # 13 Filed 07/25/07 Pg 6 of 39 Pg ID 80 other owners and lessees of vehicles with OnStar telematic equipment who did not maintain their subscriptions. The Types Of OnStar Equipment Sold By Defendants 28. From its inception and continuing to the present GM manufactured and/or sold all of their OnStar capable vehicles with wireless telematic cellular equipment. This telematic equipment would enable the vehicles to communicate with the OnStar Centers through third party cellular service providers by use of confidential access numbers. 29. OnStar’s cellular system used both the Advanced Mobile Phone System (“AMPS”) and the Code Division Multiple Access (“CDMA”) cellular standards. AMPS is analog; CDMA is digital. Although the two standards are not compatible, by 2001 most cellular equipment (i.e, cell phones) had both capabilities and could switch back and forth, depending on the kind of signal available. 30. GM touted and sold analog OnStar systems as standard and optional equipment that would provide added safety, security and convenience. When sold as optional equipment, GM would charge customers added fees of several hundred dollars for the OnStar equipment. 31. At various times, GM manufactured, distributed and sold OnStar capable vehicles with three types of wireless cellular equipment: a) Analog-Only; b) Analog/Digital Ready; and c) Dual-Mode (Analog/Digital). 32. GM vehicles with analog-only equipment were manufactured to operate only on analog wireless networks. To operate over digital networks, the vehicles’ wiring 6 2:07-cv-12036-SFC-RSW Doc # 13 Filed 07/25/07 Pg 7 of 39 Pg ID 81 and sensors would have to be replaced, and their communication modules replaced with dual mode (analog/digital) modules. As of February 2007, there were approximately 450,000 GM/OnStar subscribers with this type of analog-only telematic equipment. 33. GM vehicles with analog/digital-ready equipment have wiring and sensors that permit the vehicle to operate on digital networks by replacing the communications module with dual-mode (analog/digital) modules. As of February 2007, there were approximately 1,500,000 GM/OnStar subscribers with vehicles that had this wiring and sensor architecture which could be upgraded in this manner. 34. GM vehicles manufactured with dual-mode (analog/digital) modules would operate over digital wireless networks without modification or upgrade. 35. At the time of purchase, GM did not disclose to plaintiffs and other purchasers and lessees that the OnStar equipment in their vehicles was analog-only and would not function on digital cellular systems, or that their equipment was analog/digital- ready and would not function on digital cellular systems without substantial expenditure. Defendants’ Unfounded Reference To The FCC Rule Change As A Basis For Dropping Analog OnStar Service 36.
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